Hassan Maishera
TL;DR
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Galaxy Digital has launched OTC prediction market trading for institutional investors, enabling hedge funds and family offices to trade event-driven contracts tied to political, economic, and regulatory outcomes.
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The service, offered via its trading desk, supports large bilateral trades and includes initial exposure to Kalshi and Polymarket contracts.
Galaxy Digital (GLXY) has launched over-the-counter (OTC) prediction market trading for institutional investors, marking a significant step in the institutionalization of event-driven markets tied to real-world outcomes.
The Nasdaq-listed digital asset firm said Tuesday that its new service will allow hedge funds, family offices, and other professional investors to trade contracts linked to political, economic, and geopolitical events through a bilateral OTC framework.
Institutional Access to Prediction Markets Through OTC Desk
The new offering is being delivered via Galaxy’s global markets trading desk and is designed to address a key limitation of retail-focused platforms: liquidity and trade size.
Through the service, institutional clients will be able to trade event contracts tied to macro, political, and regulatory outcomes, access larger liquidity pools than typical retail prediction platforms, and execute bilateral OTC trades instead of exchange-only orders
Galaxy said the service initially supports non-sports event contracts from platforms such as Kalshi and Polymarket, with plans to expand to additional venues.
As part of the rollout, Galaxy facilitated a $10 million trade with crypto hedge fund Arca tied to the outcome of the proposed CLARITY Act, a U.S. bill aimed at defining regulatory frameworks for digital assets.
The transaction underscores growing institutional interest in using prediction markets as hedging tools for regulatory and macro risk exposure.
Jeff Dorman, CIO at Arca, said liquidity constraints on existing platforms have made it difficult for large-scale investors to participate directly, despite strong demand for hedging tools linked to policy outcomes.
Prediction Markets Move Toward Institutional Infrastructure
Galaxy executives said the move reflects a broader shift in how professional investors use event-driven instruments.
“Event-driven markets are becoming core to how sophisticated investors express macro views,” said Jason Urban, Galaxy’s global co-head of digital assets.
By acting as a principal counterparty, Galaxy can absorb risk and facilitate larger trades while offering more flexible execution than exchange-based retail platforms.
This structure effectively brings prediction markets closer to traditional OTC derivatives infrastructure used in equities, commodities, and macro trading.
The launch comes amid rising activity in prediction markets more broadly. Platforms such as Polymarket and Kalshi have seen increased adoption over the past two years, with growing participation in contracts tied to elections, central bank decisions, and regulatory outcomes.
On Tuesday, Polymarket also completed its first block trade through a transaction involving FalconX and Anera Labs, signaling the expansion of the institutional market structure.
